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    Xix. Union Bank vs. Court of Appeals, 23 December 1999 - Bank Secrecy

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    Zora Ideale
    Union Bank erroneously under-encoded a check deposit of P1,000,000 as P1,000. Nearly a year later, Union Bank notified Allied Bank, the bank that issued the check, about the discrepancy. Allied Bank refused to accept responsibility. Union Bank then filed a petition to examine Allied Bank's account records but both the RTC and Court of Appeals dismissed the petition. The Supreme Court affirmed, holding that the case did not fall under exceptions to bank secrecy allowed by law as the deposited money itself was not the direct subject of the litigation, but rather Union Bank sought to determine liability and damages from Allied Bank.

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    Xix. Union Bank vs. Court of Appeals, 23 December 1999 - Bank Secrecy

    Uploaded by

    Zora Ideale
    140 views1 page
    Union Bank erroneously under-encoded a check deposit of P1,000,000 as P1,000. Nearly a year later, Union Bank notified Allied Bank, the bank that issued the check, about the discrepancy. Allied Bank refused to accept responsibility. Union Bank then filed a petition to examine Allied Bank's account records but both the RTC and Court of Appeals dismissed the petition. The Supreme Court affirmed, holding that the case did not fall under exceptions to bank secrecy allowed by law as the deposited money itself was not the direct subject of the litigation, but rather Union Bank sought to determine liability and damages from Allied Bank.

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    xix. Union Bank vs. Court of Appeals, 23 December 1999- Bank Secrecy

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    Union Bank erroneously under-encoded a check deposit of P1,000,000 as P1,000. Nearly a year later, Union Bank notified Allied Bank, the bank that issued the check, about the discrepancy. Allied Bank refused to accept responsibility. Union Bank then filed a petition to examine Allied Bank's account records but both the RTC and Court of Appeals dismissed the petition. The Supreme Court affirmed, holding that the case did not fall under exceptions to bank secrecy allowed by law as the deposited money itself was not the direct subject of the litigation, but rather Union Bank sought to determine liability and damages from Allied Bank.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    140 views1 page

    Xix. Union Bank vs. Court of Appeals, 23 December 1999 - Bank Secrecy

    Uploaded by

    Zora Ideale
    Union Bank erroneously under-encoded a check deposit of P1,000,000 as P1,000. Nearly a year later, Union Bank notified Allied Bank, the bank that issued the check, about the discrepancy. Allied Bank refused to accept responsibility. Union Bank then filed a petition to examine Allied Bank's account records but both the RTC and Court of Appeals dismissed the petition. The Supreme Court affirmed, holding that the case did not fall under exceptions to bank secrecy allowed by law as the deposited money itself was not the direct subject of the litigation, but rather Union Bank sought to determine liability and damages from Allied Bank.

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    © All Rights Reserved
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    of 1

    Topic: Bank Secrecy

    G.R. No. 134699 December 23, 1999

    UNION BANK OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS and ALLIED


    BANK CORPORATION, respondents.

     Facts:

    A check in the amount of P1,000,000.00 was drawn against Account No. 0111-01854-8 with
    private respondent Allied Bank payable to the order of one Jose Ch. Alvarez. The payee
    deposited the check with petitioner Union Bank who credited the P1,000,000.00 to the account
    of Mr. Alvarez. When the check was presented for payment, a clearing discrepancy was
    committed by Union Bank's clearing staff when the amount of P1,000,000.00 was erroneously
    "under-encoded" to P1,000.00 only.

    Petitioner only discovered the under-encoding almost a year later. Union Bank notified Allied
    Bank of the discrepancy by way of a charge slip for P999,000.00 for automatic debiting against
    of Allied Bank. The latter, however, refused to accept the charge slip since the transaction was
    completed per Union Bank's original instruction and client's account is now insufficiently funded.

    Union Bank filed in the Regional Trial Court (RTC) of Makati a petition for the examination of
    Account No. 111-01854-8.The petition was dismissed because the case of the herein petitioner
    does not fall under any of the foregoing exceptions to warrant a disclosure of or inquiry into the
    ledgers/books of account of Allied Checking Account No. 111-01854-8. The Court of Appeals
    affirmed the dismissal of the petition, ruling that the case was not one where the money
    deposited is the subject matter of the litigation.

    Issue: Whether or not the money deposited is the subject matter of the litigation as
    contemplated in the Bank Secrecy Act.

    Held:

    No. By the phrase "subject matter of the action" is meant "the physical facts, the things real or
    personal, the money, lands, chattels, and the like, in relation to which the suit is prosecuted, and
    not the delict or wrong committed by the defendant.

    Petitioner is fishing for information so it can determine the culpability of private respondent and
    the amount of damages it can recover from the latter. It does not seek recovery of the very
    money contained in the deposit. The subject matter of the dispute may be the amount of
    P999,000.00 that petitioner seeks from private respondent as a result of the latter's alleged
    failure to inform the former of the discrepancy; but it is not the P999,000.00 deposited in the
    drawer's account. By the terms of R.A. No. 1405, the "money deposited" itself should be the
    subject matter of the litigation.

    That petitioner feels a need for such information in order to establish its case against private
    respondent does not, by itself, warrant the examination of the bank deposits. The necessity of
    the inquiry, or the lack thereof, is immaterial since the case does not come under any of the
    exceptions allowed by the Bank Deposits Secrecy Act.

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